**Key Takeaways**
– Why did Plasma defy typical bearish trends?
Open Interest surged to $255 million despite a 15% price drop, showing renewed trader participation.
– What could drive XPL rebound soon?
A steady Long/Short Ratio above 2.0 and ongoing short liquidations may strengthen bullish momentum.
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Plasma [XPL] dropped nearly 15% in the past 24 hours, extending its slide throughout October. Yet, on-chain data revealed unusual behavior among derivatives traders that could hint at an early-stage rebound—if bulls can sustain their momentum.
### Open Interest Surges Despite the Bearish Drop
Despite the steep decline, Plasma’s Open Interest (OI) rose to $255.08 million, up from lows of around $233 million. Typically, OI contracts when prices fall as traders exit positions. However, this rise suggests new positions are being opened, possibly by institutional traders buying the dip.
This influx of new capital into the derivatives market indicates speculative confidence returning, even amid bearish spot price action.
### Short Liquidations Send Mixed Signals
At the same time, Plasma’s aggregated short liquidations climbed to $1.33 million at press time, compared to just $49,000 in long liquidations. This imbalance reflects growing short pressure being squeezed as volatility rises.
Such a setup could go either way: it might lead to a deeper correction if momentum fades or trigger a rapid bounce if short sellers retreat.
### Plasma Buyers’ Dominance Complements Surging Institutional Interest
At the time of writing, Plasma’s Long/Short Ratio (average) stood at 2.027, indicating that longs outnumber shorts roughly two to one. This dominance often signals increasing trader conviction in a price recovery.
However, whether this optimism holds depends on sustained demand in both spot and futures markets. The combination of short liquidations and higher long exposure currently gives bulls a near-term edge, but only continued accumulation can confirm a trend shift.
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### What Could Be Next for XPL?
In summary, the current setup presents a mixed but potentially optimistic outlook for XPL’s price action. Although the recent sharp decline nearly pushed the token toward collapse, rising open interest and strong buyer dominance suggest growing market confidence.
If bullish momentum continues to build, XPL could be approaching a meaningful reversal. Traders and investors should watch key indicators closely to gauge whether this turnaround will hold.
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